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Morning Briefing for pub, restaurant and food wervice operators

Mon 2nd Nov 2020 - Update: 12,000 pubs could never re-open, Brighton Pier Group, Hugh Osmond
BBPA – 12,000 pubs may never re-open: More than a quarter of all pubs face permanent closure in the wake of the new lockdown in a crisis described as greater than that even posed by the Second World War, The Daily Telegraph has reported. The British Beer and Pub Association (BBPA) said on Sunday that 12,000 pubs in the UK out of 47,000 may never reopen following lockdowns announced by Westminster and by the devolved governments. The trade body complained the sector is being unfairly targeted with Public Health England’s own figures showing just 31 outbreaks of covid-19 out of a total of 1,392 in the week ending October 29 had been linked to the hospitality sector. The industry body’s survey of its members suggests pubs are responsible for about 1% of outbreaks. In contrast schools, universities and other educational establishments were linked to 311 incidents – almost a quarter of all outbreaks in that week. The new lockdown in England threatens to be more devastating than the first with pubs banned from selling takeaway beer this time around in the run up to the busiest time of the year for the hospitality trade. Emma McClarkin, the BBPA’s chief executive and a former Conservative MEP, said on Sunday night: “This is the nightmare before Christmas. Our research suggests 12,000 pubs could close putting 290,000 jobs at risk. That is a huge number. For the pub industry this is no longer about surviving these four weeks of lockdown but surviving through the winter and just getting to spring. This is the biggest crisis ever to the great British pub. It is a bigger crisis than the Second World War. For the hospitality sector it is crippling; the restrictions are crippling.” The BBPA said the second lockdown, beginning on Thursday and announced by Boris Johnson on Saturday night, will automatically shut 37,500 pubs in England. But Ms McClarkin said: “We have an extremely narrow transmission and yet we are the full focus of the restrictions.” According to the BBPA, pubs have spent upwards of half a billion pounds putting in place measures to maintain social distancing and prevent the spread of covid-19. The BBPA said the financial support from the Chancellor needed to be greater than measures announced in the spring after the first lockdown if pubs were to survive. 

Luke Johnson – ‘the government needs to change course’: The Brighton Pier Group, which owns and trades Brighton Palace Pier, as well as eight indoor mini golf sites and twelve premium bars nationwide, has reported turnover dropped to £22.6m in the year ending 28 June (2019: £32m). It made a loss of £10.2m (2019: profit of £2.7m). The company stated: “The prolonged closures have resulted in impairments to goodwill, property, plant and equipment and right-of-use assets totalling £8.1m. Of this, £7.2m relates to the Bars division, much of which remains unable to trade.” Chief executive Anne Ackord said: “The covid-19 pandemic has presented an unprecedented challenge to our business. The closures during Spring 2020 came during what would normally be a key trading period, spanning both the Easter break in April and two May Bank Holiday weekends. Whilst the lost trade is disappointing, I’m proud of the way in which our team has responded to ensure the group remains in a strong financial position in such uncertain times. Thanks to their efforts, the group is well placed to resume normal trading at the earliest opportunity.” Chairman Luke Johnson added: “Group trading for the period from 4 July to the end of September has been better than the board expected. Like-for-like sales (excluding closed sites) for the group as a whole were at 81% compared to the same 13 weeks last year. The pier has traded at 83%, the Golf division at 87% and the Bars at 65% compared to the same 13 weeks last year. This trading was ahead of the group’s expectations at the time of the reopening. It is profoundly disappointing to me that the government continues with its failing strategy of lockdowns. The collateral damage from these restrictions and the fear being promoted by the authorities are having a catastrophic impact on our way of life. The loss of jobs, toll on mental health, harm to education, the national finances and treatment of other illnesses will cause vastly more hardship than the virus itself. I believe that the government and their scientific advisors at SAGE need to change course and focus on protection of the vulnerable, while allowing the majority of the population – who are at low risk from the virus – to resume their normal lives and work, so the country can fund the NHS. Otherwise we are doomed to a never ending cycle of destructive and pointless lockdowns, mass unemployment, suicides, bankruptcies, evictions and economic, cultural and social ruin.”

Hugh Osmond – ‘this government has betrayed a generation of young people’: Sector entrepreneur High Osmond has argued the government’s new lockdown has betrayed a generation of young people. Writing in the Daily Mail, he states: “What a desperately sad moment it will be when last orders are called on Wednesday night in pubs and bars across the nation. It’s not just that the occasion will mark the last time for at least a month that anyone can enjoy a drink in comfort away from home – but with the shock announcement that the country is going to be plunged into lockdown for the second time this year, the reality is that for many entertainment venues this really will be time at the bar. Make no mistake, once the last meal is served and the last pint pulled, a swathe of these establishments will not be re-opening their doors. Having struggled through the first lockdown, they can’t survive a second. In August, a survey by the trade body UK Hospitality found that 75% of hospitality businesses were at risk of insolvency as they struggled to find a way to stay open. Further research within the industry suggests a similar number have already been in talks with insolvency practitioners. The run-up to Christmas, traditionally the busiest time of year for the industry, offered a glimmer of hope. But with Michael Gove’s warning yesterday that this lockdown may well last more than a month, Christmas is already over in the hospitality industry. This catastrophe is, however, about so much more than the depressing prospect of seeing boarded-up pubs, bars and restaurants, places that for generations have been the warm, hospitable heart of our villages, towns and cities. Nor is it solely about the knock-on effect of such closures on suppliers and services: fishmongers, butchers, bakers, florists, cleaners and launderers. All will be hit hard, with hundreds of thousands of jobs in peril. But my greatest fear is for the young people who, for the most part, staff our establishments – an entire generation who despite being at virtually zero risk from covid-19 will pay the heaviest price of all. Hospitality, along with retail, is the biggest employer of school and university leavers in the UK. Some have few qualifications – the only prerequisite for the job is a friendly disposition and a readiness to work hard. But as many of them are inevitably forced out of work, between 30 and 50% of under-25s could soon be facing unemployment. This is likely to be accompanied by a rise in mental health issues, even homelessness. We can also expect to see a rise in drug abuse and suicide rates. As the father of three teenagers, aged from 14 to 19, I believe this government has betrayed an entire generation of young people. And for what? They are not driving this disease – nor are they, in general, at risk from it. It’s also a complete myth that entertainment venues have been the driver of coronavirus infections or that the Eat Out to Help Out scheme contributed to its spread. I do believe is that Boris Johnson’s government has turned its back on our young people. They will pay a heavy price for doing so, not least at the next general election when they will undoubtedly be held to account by those they betrayed.”

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